It has been said that silence is golden, but, unfortunately,
that is not always the case when attorneys are dealing with their clients.
It is prudent to provide cautionary advice whenever possible.

Intellectual property has emerged as one of the most dynamic
areas of modern law. Despite the specialized nature of this field, it
is essential for every lawyer, regardless of the discipline in which
she or he practices, to have some familiarity with general intellectual
property principles and the potential traps for the unwary.

TrademarkNames, symbols, logos and combinations of these,
when used to identify the sources of products or services,
are within the purview of trademark law. In order to
determine whether a trademark may legally be adopted
by a business, it is essential to determine whether the
name, symbol or logo is potentially protectable and whether
the proposed trademark sounds like, looks like or is
confusingly similar to a protected mark.

In ISCYRA v. Tommy Hilfiger, 80 F.3d 749 (2d Cir.
1996), the world-renowned clothing designer desired to use the words "Star
Class" and a solid red, five-point star to adorn a line of nautical
clothing products. The clothing designer’s attorney recommended that
a full trademark search be conducted, but the client felt that it was
not necessary and examined only marks in Class 25, a clothing classification.
A full search would have revealed the International Star Class Yacht
Racing Association’s use of the mark in the yachting context. The court
said, "Willful ignorance should not provide a means by which [the
defendant] can evade its obligations under trademark law." The case
was remanded for additional findings on whether defendants acted in bad
faith because of a failure to conduct an adequate search. Commentators
have suggested that the Hilfiger case provides a clear message
that intentional ignorance will not be tolerated.

It is not uncommon for clients to adopt a trademark or
trade name without conducting an appropriate search. In these situations,
stationery is purchased, signs are installed, advertising is commenced — and
then a prior user of the trademark or one confusingly similar to it complains.
At a time like this, it is obvious that the cost of an appropriate search,
the loss of goodwill resulting from the change aside, would have been
far less than the cost that will be incurred in changing the mark.

Therefore, it is clear that a prudent business lawyer should
advise clients to conduct trademark searches before using any names,
symbols or logos to identify products or services. There are a number
of professional search firms listed in the Yellow Pages that can conduct
the search for your client, and many law firms conduct preliminary searches
in-house as well. A review of the Patent and Trademark Office’s website
(www.uspto.gov) will aid in determining whether a trademark is registered,
though it will not provide information on common law uses which may have
priority.

CopyrightVirtually everybody deals with some form of copyrightable
material. These include, among other things, art, literature,
music, software, or, using the words of the statute,
any "original work of authorship." All that
the law requires is that the work be original, that
it have some degree of creativity and that it be fixed
in a tangible form.

Since Jan. 1, 1978, any copyrightable item is automatically
protected by the federal statute once it is "fixed" and in
a tangible form. Initially, the revised copyright statute required the
work, when published, to have a copyright notice affixed to it, or the
protection would be lost. In 1988, the law was amended when the United
States became a party to the Berne Copyright Treaty. Section 401 of the
Copyright Act was revised to make the notice provisions optional, and
since March 1, 1989, when the Berne Convention Implementation Act
took effect, the notice is no longer required.

Unfortunately, this is not the entire story. A prudent
lawyer will advise clients that relying on Section 401 is dangerous for
at least two reasons. First, Section 405(b) makes it clear that one who
relies on the omission of notice may be deemed an "innocent infringer." Innocent
infringers, according to the statute, may not be liable for damages and
may even be permitted to continue their infringing activities. Section
401(d) provides copyright owners with the ability to defeat the defense
of innocent infringement by having the appropriate copyright notice affixed
to the work when it is published. It would, therefore, be appropriate
to warn clients that the copyright notice is not required by the statute,
but failure to use it on published copyrighted works can significantly
undermine the protection afforded by the federal statute.

The second problem deals with registration. It is not necessary
to register and deposit the copyrighted work with the Library of Congress
unless the copyright has been infringed and you desire to file suit for
infringement – the work is copyright-protected without registration.
However, Section 411 makes it clear that a copyright owner may not file
suit for infringement unless the copyrighted work has been registered.
It is also prudent to register the copyrighted work when the Library
of Congress, after discovering no work has been deposited with it after
publication, requests that two of the best copies of the work be deposited
with the Library of Congress. Failure to do so can subject the copyright
owner to statutory penalties of up to $250 per work, the total retail
price for this work, or the cost to the Library of Congress to acquire
copies and a fine of $2,500.

One might conclude from this discussion that registration
and deposit are not important unless the Copyright Office demands deposit
or unless an infringement has occurred. Unfortunately, this is not the
case, and a prudent lawyer should advise clients that delaying the registration
of a copyright can be devastating.

Sections 502 through 505 of the statute provide copyright
owners with a host of remedies when their rights have been infringed.
These include the ability to recover actual damages, to obtain injunctive
relief, and to obtain an order requiring that infringing works be destroyed.
If and only if the work was registered before the infringement occurred,
the statute provides for statutory damages in lieu of actual damages
of no less than $750 and up to $30,000 per infringement, and if the infringement
can be shown to be willful, up to $150,000 per infringement. With a copyright
registered at the time of infringement, in addition to these remedies,
the copyright owner may recover reasonable attorneys’ fees incurred in
the litigation. Additionally, if the work is registered within three
months of the date of first publication, the registration will be retroactive
back to the date of first publication.

It is, therefore, clear that failing to promptly register
one’s work may put the copyright owner in the untenable position of having
to litigate a federal case without the possibility of being able to recover
the attorneys fees incurred in the litigation. In addition, it is often
the situation that actual damages are quite low because the infringement
was discovered early on, thus, the recovery may be paltry. Without the
ability to recover statutory damages in lieu of actual damages, protecting
one’s copyright may be an expensive and unrewarding experience.

A prudent lawyer will, therefore, advise clients who deal
with copyrightable material that use of a copyright notice, while not
required, is nevertheless important and that registration of copyrighted
works is important, even though it is not necessary for purposes of obtaining
copyright protection.

PatentsAn invention of a "new and useful process,
machine, manufacture or composition of matter, or any
new and useful improvement thereof" may be patented.
The patent law makes it clear that a patent may only
be applied for within 12 months of initial disclosure
of the invention. This is referred to as the "on
sale bar," and courts have clarified what "on
sale" means for purposes of starting the one-year
clock ticking. In Pfaff v Wells Electronics,
the Supreme Court announced two conditions that, if
satisfied, will start the clock running. First, the
product must be offered for sale; and second, the invention
must be ready for patenting. In Pfaff, an engineer
showed a sketch of a concept for a new socket to Texas
Instruments, and, though he made no prototype at the
time, Texas Instruments placed an order. The Court
considered the invention to have been "on sale" from
the time of the offer.

It is, therefore, important for attorneys to advise clients
who desire to obtain patent protection that an application must be filed
within 12 months of the date the invention is disclosed or the right
to obtain a patent will forever be lost. This situation gave rise to
a new and interesting phenomenon. The www.bountyquest.com site allowed
individuals or businesses wishing to obtain information about "prior
art" to post that request and offer a bounty for the information.
Anyone throughout the world who provided information establishing "prior
art" would earn the reward, and the advertiser would be in a position
to invalidate a patent. Bountyquest.com was extremely busy, and numerous
offerings were posted. For some reason, this site has gone dark, but
there are likely other similar posting ventures on the horizon.

In today’s world of rapid online communication, inventors
desiring patent protection must be diligent. Before applying for a patent,
a "prior art" search should be conducted to determine whether
the invention is truly new and innovative, or whether rights have already
been secured by somebody else. In addition, once a prior art search has
been completed and it is determined that the invention is potentially
patentable, an application must be filed within one year of initial disclosure.
Prudent lawyers will alert their clients to these facts and, if the attorney
is not licensed to practice before the Patent and Trademark Office, recommend
that they work with a patent attorney or patent agent.

Trade SecretsThe Uniform Trade Secrets Act has been adopted
in some form by virtually every state in the United
States. Under that statute as adopted in Oregon, a
trade secret is defined as information that derives
economic value from not being generally known to the
public or to other persons who can gain economic value
from its disclosure and is the subject of efforts to
maintain its secrecy. The law thus affords protection
for anything which provides commercial advantage and
which is treated by its owner as a "secret."

Prudent lawyers will advise their clients to adopt a trade
secret program. This will require an experienced business lawyer to evaluate
a company’s trade secrets and recommend methods whereby they can best
be secured. The statute does not require that trade secret owners use
written agreements, but it is wise to do so. Skilled lawyers will recommend
that all employees be advised of the fact that they will be working with
and exposed to the business’s trade secrets, which should be protected.
Employees should also be coached on how to best protect those secrets.
This employee education should begin when the individual is first hired
and continue throughout employment. An admonition about the company’s
trade secrets should be given when the employment is terminated as well.
Similarly, written nondisclosure-nonuse agreements should be used whenever
individuals other than employees are given access to the business’s trade
secrets. Care should be taken to mark all trade secrets as such, as they
should be secured as well as possible.

A prudent lawyer will either personally or through the
use of a skilled business attorney provide clients with a recommendation
regarding trade secrets. This is important to do before there are any
problems with respect to misappropriation of those trade secrets. Unfortunately,
failure to properly protect a business’s trade secrets may result in
a loss of those valuable assets.

ConclusionAttorneys are occasionally criticized for "over-lawyering" projects.
This is sometimes the case, but it is wiser to be cautious
and provide clients with well-intentioned recommendations
with respect to their intellectual property than to
find that a client has been deprived of protection
or remedies as a result of your failure to make appropriate
recommendations. This is not only essential for intellectual
property lawyers — because virtually every business
attorney has clients who are involved with some form
of intellectual property, but even the general practitioner
should have some elementary knowledge of the potential
traps that clients should avoid with respect to that
property. It is, after all, quite rewarding for an
attorney to learn that the recommendations he or she
made were followed and that the client was able to
protect his or her intellectual property rights as
a result of the attorney’s advice.

ABOUT THE AUTHORLeonard DuBoff is the author of more than 20 books on business and
intellectual property law